The revenue authority plans to cut the tax rate for individuals in the lower tax brackets instead of raising the tax-free income limit.

"It may not be possible to raise the tax-free income ceiling," Md Mosharraf Hossain Bhuiyan, chairman of the National Board of Revenue, said at a pre-budget discussion at his office in the capital yesterday.

He spoke in a meeting with the leaders of Dhaka Chamber of Commerce and Industry, which proposed raising tax-free income ceiling toTk 3 lakh from 2018-19.

Yesterday, the Bangladesh Chamber of Industries (BCI) and the Dhaka Stock Exchange demanded the limit be set at Tk 3.5 lakh for the next fiscal year due to rising cost of living.

Bhuiyan said anyone living outside Dhaka and Chittagong city corporations with annual incomes of more than Tk 2.50 lakh has the ability to pay a minimum tax ofTk 3,000. "Tax payment should be made a part of habit," he said.

The NBR, however, will examine the scope to reduce corporate tax rates responding to pleas from the DCCI to reduce the rate gradually from 30 percent to 25 percent for non-listed companies by 2020-21.

"The government is considering all the proposals that were placed with calls to cut corporate tax. Let us see how much can be done. We have a long-term plan to reduce corporate tax," Bhuiyan said.

The DCCI suggested the tax authorities give tax waiver on expenses for education for children of

taxpayers.

"This is necessary to educate our children. This incentive will give a big boost to the taxpayers," said DCCI President Abul Kasem Khan.

The chamber also urged the NBR to give tax benefits to the companies that are investing 5 percent of their taxable income for research and development.

"We will consider the tax benefit issue," Bhuiyan said.

He said the NBR is also working to ensure some privileges for the compliant taxpayers, especially for those who are honoured as "Kar Bahadur (tax icons)".

He said the rate of VAT evasion is

high. “We will strengthen the monitoring."

In another discussion with the BCI, he said the NBR also plans to slap penalties for cases ofVAT evasion.

The BCI also demanded the introduction of concessional tax rates for investment in the underdeveloped regions.

It is also necessary to provide tax breaks to the backward linkage industries of export-oriented sectors, said BCI President Mostofa Azad Chowdhury Babu.

In another discussion, the DSE demanded tax waiver on its income for another year.